Clare Daly (Dublin North, United Left) | Oireachtas source

He said that the pension contributions were insufficient, which is incorrect. It is certainly not correct from the workers' point of view. The pension contributions of the staff were set by an actuary and were reviewed every three to five years to make sure that they would meet the benefits required under the rules of the scheme. Pensioners paid into the scheme for a period of 45 years. Over the course of that time, the contribution structure for the pensioners increased seven times for those on an uncoordinated pension. What happened during the same period? The employers' contribution decreased three times. In addition, the actuarial report was based on certain assumptions with regard to the so-called early leavers, namely, the deferred group. These were people who were enticed out of their jobs on the solid promise of an expected standard of living in their retirement years.

They had a legitimate expectation and in a recent court case relating to IBM in Britain, it was stated that it is a reasonable expectation which should be protected in law.

The major drawback with the scheme was that it never provided for the massive staff reductions which took place over the years. When the actuary and the trustees became aware of this problem they pointed out to the employers that if they continued with their massive staff reductions, significant stress would be placed on the scheme. All of the issues were well flagged. The attitude of the employers was that they did not really care because they were going to establish their scheme in any event. The problem with the legislation before us is that it lets those responsible off the hook. The Bill does not contain any reference to an employer covenant. Instead, the victims, namely, those whose pensions are going to be affected as a result of poor management decisions, are going to be obliged to pay the price.

One of the other reasons there is a problem with the scheme relates to a number of ill-judged and ill-timed decisions taken by the trustees of the scheme. The Minister is aware that the scheme sold assets of €1.4 billion in 2001 as part of a freeze and de-risk strategy. This equated to utter lunacy on one level, particularly when one unravels what the trustees actually did. The trustees took the decision to sell a number of assets which were the property of the members of the pension scheme. In other words, it sold a prime commercial portfolio and shareholdings and reinvested the moneys they obtained in sovereign bonds. The latter under-performed massively in the context of the yields achieved. The trustees decided to divest themselves of the assets to which I refer at a time when commercial property prices were beginning to rise. As a result, one of six properties sold by the IASS to IPUT for €58 million was valued at €67 million by the end of last year. This means that the assets of our pension scheme were literally given away for no valid reason. The rent roll on the property in question was €6.5 million annually. The proceeds of the transaction to which I refer were invested in bonds which under-performed.

Even more sinister, another property - that formerly owned by IASS, located across the road in Molesworth Street adjacent to the offices of Jones Lang LaSalle and currently home to the Passport Office - was purchased by IPUT. That property is subject to a planning application which includes the Passport Office and the offices of Jones Lang LaSalle. The people who are the potential beneficiaries of the sale were also the advisers to the IASS at the time the sale took place. The decisions to which I refer have impacted upon the pensioners involved and the legislation before us penalises them rather than addressing the issues to which I refer.

The Minister has previously stated that he cannot interfere in the activities of a private company. The DAA is a fully public company and there is still a 25% public shareholding in Aer Lingus. What is happening here is a case of double standards. It is ironic that soon after the Bill went through the Seanad, the Minister for Jobs, Enterprise and Innovation amended the relevant legislation as a result of concerns expressed with regard to the transfer of Forfás workers to various bodies. Those concerns related to the fact that the terms and conditions of the workers in question would not be sufficiently protected and that remuneration and non-remuneration aspects were not adequately covered. The Government is saying that the rights and pension of those public sector workers can be enshrined but that those of the members of the IASS, who historically operated as part of a public scheme, cannot.

On Committee Stage we will debate the fundamental problem that exists, namely, that the legislation exposes existing pensioners, deferred members and those paying into the scheme, overrides the limited protections that are currently in place and allows decisions to be made without their being consulted. In addition, those who made previously poor decisions - the employers and the trustees - will not be obliged to take responsibility for their actions. Instead, the Minister is choosing to penalise the members of the scheme. Section 34 of the Bill must be deleted.

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